■ The company made a USD 20 million of equity investment in Fulcrum and is considering the global business of converting waste into fuel

■ Fulcrum is the first American company to begin to commercialize a process for producing synthetic crude oil from household garbage

■ “By expanding its green business portfolio, SK Innovation seeks to transform itself into a Green Energy & Material Company”

SK Innovation is adopting a next generation technology that will lead the waste recycling market. By doing so, the company is seeking to accelerate development of its green business portfolio that puts future energy sources and a circular economy at the center of it.

On July 13 (KST), SK Innovation announced that it invested USD 20 million in Fulcrum BioEnergy, an American renewable transportation fuels producer using household garbage. Late last year, SK made a USD $50 million of joint investment with a Korean private equity in Fulcrum BioEnergy as part of its ESG investments.

With the equity investment this time, SK Innovation will join hands with Fulcrum BioEnergy to consider exploration of select Asian markets for “converting waste into fuel”. As the American company is a biofuels producer that gasifies landfill waste to produce low-carbon transportation fuels, the Korean energy provider will focus on developing and obtaining the next generation technology enabling the conversion through business and technical cooperation. It means increasing new growth engines in a circular economy where waste resources are recycled.

Waste gasification is one of the technologies to turn waste into fuel and a process where trash is heated in low-oxygen environment to produce synthesis gas which is a mixture of hydrogen and carbon monoxide. In the process, waste such as textiles, paper and wood can be used as a feedstock to produce the synthetic gas which is in turn processed into high value products including synthetic crude oil which is then upgraded to sustainable aviation fuel. As the waste recycling market is expected to grow, the waste gasification is also forecast to play an important role as a waste treatment process.

International Solid Waste Association (ISWA) suggests the world generated 2.1 billion tonnes of municipal solid waste in 2020 and the number is projected to reach 2.3 billion tonnes by 2030 while 1.2 billion tonnes of waste is dumped every year in the world. Since it has been an issue to treat waste through incineration or landfills which result in problems of greenhouse gas emission and lack of landfills, the waste recycling market is expected to show steady growth in the mid- and long-term.

Fulcrum was founded in Pleasanton, California, in 2007 and is commercializing a process to produce synthetic crude oil from household garbage for the first time in the U.S. Its process, which is one of the best, integrates its own proprietary process with proven, commercial refinery technology which gasifies the garbage and produces synthetic crude oil. In July 2021, the company completed construction of the world’s first synthetic crude oil plant in Nevada with an annual capacity of 11 US million gallons per year and started operations of the plant in late May. Fulcrum plans to produce upgrade the syncrude to sustainable aviation fuel in the future.

To achieve net-zero by 2050, SK Innovation is developing a green business portfolio whose two important pillars are future energy sources and a circular economy. In May, the company signed an agreement on business cooperation with TerraPower, an American SMR company, and invested in Amogy, an American developer of a fuel cell system using ammonia as a fuel, last month.

An SK Innovation official said, “We aim to grow in the future by developing a green business portfolio that puts carbon-free and low-carbon energy and a circular economy at the center of it.” He added, “That will lead us to become a Green Energy & Materials Company.”

[Image] Synthetic crude oil production process from household waste by Fulcrum BioEnergy